Disinvestment of a sick Government company cannot be blocked by employees absent mala fides, arbitrariness, or constitutional violation.

A bona fide State decision to disinvest a chronically loss-making Government company, taken in public interest, is not ordinarily open to judicial restraint. Employees of a Government company are not Government servants and have no vested right to insist that the State continue ownership or control. Articles 14 and 16 do not require the State to retain employment under it, and Article 19(1)(g) does not protect a right to continue in a particular establishment. In the absence of mala fides, arbitrariness, or constitutional or statutory violation, the policy choice cannot be substituted by the court, and employees retain access to legal remedies despite disinvestment.

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Issues: Whether the State could be restrained from disinvesting its holding in a Government company at the instance of employees on the grounds that further State support could revive the sick unit, or that disinvestment would violate Articles 14, 16, 19(1)(g), 226 and 32 of the Constitution.

Analysis: The company was a chronically loss-making sick industrial unit, and the material before the Court showed that the decision to disinvest was taken after sustained governmental consideration in the larger public interest. The Court held that economic and policy choices of the State are ordinarily not open to judicial substitution unless they are shown to be mala fide, arbitrary, or unconstitutional. It further held that employees of a Government company are not Government servants and have no vested right to insist that the State continue to own or control the company. The protections of Articles 14 and 16 do not compel the State to retain employment under it, and disinvestment does not take away the employees' access to legal remedies. The Court also held that the proposed disinvestment did not infringe Article 19(1)(g), because the right to carry on an occupation is distinct from a right to continue in a particular job or in a particular establishment.

Conclusion: The challenge to the disinvestment policy failed. The State could not be compelled to continue ownership of the company at the instance of the employees, and the writ petition was rejected.

Final Conclusion: Disinvestment of a sick Government company, when taken as a bona fide policy decision in public interest, is not liable to be interdicted merely because employees may lose the status or advantages flowing from State ownership.

Ratio Decidendi: A bona fide State policy decision to disinvest a Government company, taken in public interest and absent constitutional or statutory violation, is not subject to judicial restraint at the instance of employees who have no vested right to insist upon continued State ownership or control.

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